The sudden but not unexpected closure of Southern California's largest PPM has raised questions about who is liable for thousands of unread patient test results.
Estimates of the number of unread tests from former KPC patients vary from 1,200 to 2,000, based on reports from health plans, state officials and physicians.
The health plans have hired an independent lab to read enrollees' tests and hoped to have that completed by the end of the month. KPC, which bought clinics from the former MedPartners, closed its doors and filed for bankruptcy in November after months of failing to pay specialists and after a financial bailout by the state's health plans. The California Medical Association estimates KPC owes specialists $40 million.
CMA officials say the health plans failed patients by not paying high enough capitation rates to cover the costs of lab fees and says the state's Department of Managed Health Care has "bungled" the transition of patients to other medical groups. Officials with the California Association of Health Plans say the plans fulfilled their obligations and that paying the labs isn't their responsibility.
Despite the CMA's assertions, the transition of patients from KPC-managed practices to other medical groups appeared to have gone fairly smoothly.
Still, thousands of test results fell through the cracks, and the exact reason has been difficult to pinpoint. Some say it's because the KPC-contract labs weren't paid; others say physicians never delivered results to patients before the clinics closed.
At least one expert believes doctors could be legally, professionally and ethically liable for not getting patients their test results.
"A doctor has an ethical responsibility, and in almost every state a legal responsibility, to provide records and information," says James Winn, M.D., executive vice president of the Federation of State Medical Boards. Winn emphasized he was speaking about situations in general and didn't know all the details surrounding KPC.
"I don't care if the practice has gone belly up. The physician licensed by the state has that responsibility if he has in his possession records on that patient. A complaint could be lodged against him with the medical board."
Once a lab physician or the patient's physician starts processing tests and test results, the doctor is obligated to finish the work-up, Winn says. If they don't, "That's akin to a doctor scrubbing for surgery, then he finds out that he's not getting paid as much as he thought and says, 'Wake the patient up.' (Medical boards) would take a dim view" of that situation, Winn says.
If the lab never returned test results, the physician can't be held responsible legally, Winn says. However, the referring physician is ethically bound to make "good faith efforts" to get the results, he says.
If the labs decided not to process tests or send results because they hadn't been paid, that also would be unethical, Winn says.
The blame doesn't rest with physicians, says CMA spokesperson Peter Warren. There have been other problems for patients and physicians, many of which were brought on by the failure of the DMHC to ensure a smooth transition, Warren says.
"This is no transition at all," Warren says. "They seem to be doing this by the seat of their pants."
Daniel Zingale, California's managed care chief, says the department's main concern has been patients and their care. "There were some who argued our responsibility was to sustain KPC. Others argued that we should completely stay out of anything in a private healthcare system," he says. "The concerns about quality of care began before the transition and before the demise of KPC."
The department's mandate is not to supervise contracts between health plans and physicians, Zingale says. The department is, however, moving toward requiring audited financial statements from medical groups. "It's an important step toward avoiding situations like this in the future," he says.
Phone calls to KPC President Kali Chaudhuri, M.D., his associates and his attorney weren't returned.
For their part, the health plans say that if they had known that lab results weren't being read or passed along to patients, they would have intervened, says John Schneider, CAHP's director of research and health economist.
The health plans never paid lab fees because it wasn't their responsibility, says Bobby Pena, spokesperson for the CAHP. The plans paid the capitation rates that KPC was supposed to use to pay the labs.
"For the CMA to be questioning that is frankly ridiculous," he says, adding that CAHP is not blaming physicians. "Our motives are clear. We have to get results to (enrollees). You have to wonder why (KPC) wasn't paying the labs before. We were paying KPC. We were living up to our contract obligations."
Some physicians, like the organization that represents them, say the plans never paid the money. Ed Morgan, M.D., a Pasadena, Calif. orthopedic surgeon who oversees a chain of clinics, is one of them. He estimates KPC owes his group about $140,000. About 85% of Morgan's group's business is managed care, and KPC was one of its larger clients.
"With KPC in bankruptcy, there is no entity to pay these outstanding debts," Morgan says. "It's a lot more disastrous" than when MedPartners went under and KPC bought it.
The patients have to "start from ground zero" with their testing and scheduling of surgery, Morgan says.
The health plans promised money, didn't release the money and then moved patients to other groups, Morgan says.
"It's bizarre the thinking that goes on. Instead of the plans bringing in more business, they're taking business away. They arbitrarily move patients to punish medical groups. It makes their survival even less likely. It's the final stake through the heart."
